Scrap Reddy brothers’ mining lease, says apex court panel

The Supreme Court-appointed Central Empowered Committee has recommended cancellation of the Reddy brothers’ mining leases in Andhra Pradesh on grounds of various illegalities.

The committee said in its 69-page report: “The sorry state of affairs could not have taken place without the active connivance of the concerned (AP) State Government officers. The almost non-existent monitoring mechanism largely contributed to the large-scale illegalities which have occurred.”

The Reddy brothers include the Karnataka Ministers G Karunakar Reddy and G Janardhan Reddy. The committee comprised officials of the Survey of India, Andhra Pradesh Government’s revenue, forest and irrigation departments, and the mining firms’ representatives.

The committee, which looked into the six mining leases in Bellary Reserve Forest in Andhra Pradesh following the apex court’s directions, recommended that four mining leases spread over 140 hectares be cancelled.

These include 3 given to Reddy brothers’ Obulapuram Mining Company (OMC) and one to Anantapur Mining Corporation (AMC). The mining sites looked into included that of OMC, AMC, SK Modi group’s Bellary Iron Ore Pvt Ltd (BIOP) and Y Mahabaleshwarappa & Sons (YMS).

Stating that mining done in the area after 2004 was illegal, the committee also suggested that the value of the mineral extracted from the reserved forest after April 2004 should be recovered from the lease holders based on its normative value.
The reasons given for scrapping of leases to OMC include illegal extension of lease deed, illegal mining outside the approved lease area, illegal use of reserved forest outside the approved lease area for over-burden dump, the lease deed executed by the Mines Department differing materially from forest area for which approval under the Forest (Conservation) Act, 1980, was obtained, illegal construction of five roads in the Reserved Forest and outside the approved area in violation of law and lease conditions, and the finding that mineral transported in the guise of what was extracted from the lease area was much more than what could have been extracted as per mining pits’ size.

The grounds for cancellation of mining lease to AMC include granting of renewal of mining lease 17 years after the earlier renewed lease period expired, 11 lakh tonnes iron ore transported without obtaining permit from the Forest Department, and the mineral transported being far in excess of what could have been extracted from the lease area.

The committee said BIOP and YMS should be directed to pay exemplary compensation at the rate of 20 times the normal Net Present Value payable for the forest area used by them, for the use of Reserve Forest Area outside the approved leased area for dumping over-burden. The committee also recommended suspension of mining and transportation including from the Reddy brothers' mines till the inter-state boundary between Karnataka and AP in the area is formally determined and permanent boundary pillars are set up. It has also suggested that mining by these firms should be suspended till exemplary compensation payable by these lease holders are deposited in the Compensatory Afforestation Fund.

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