SC-empowered panel nails Reddy brothers

CEC recommends cancelling leases of mining barons firms operating illegally

Karnataka’s nouveau mining magnates — the Reddy brothers — suffered a jolt when a Supreme Court-appointed committee on Friday recommended that leases to their companies be cancelled.

The Central Empowered Committee (CEC) also sought directives to stall the Reddys’ mining operations, which flourished because of connivance on the part of some Andhra Pradesh government officials, in the region until inter-state boundary and mining areas were demarcated. The committee’s recommendations, submitted to the Supreme Court on Friday, were based on field visits to the Ananthapur area, near the Karnataka-Andhra Pradesh border, between December 15-29, last year.

The committee recommended cancellation of leases for 25.9 hectares, 39.5 hectares and 68.5 hectares of the Obalapuram Mining Company (OMC) and also of the Ananthpur Mining Company (AMC) -- firms owned by the Reddy brothers which are said to bankroll their political interests.

It is learnt that the majority stake in OMC is held by G Janardhan Reddy and Karunakara Reddy, who are ministers in the Karnataka government.

A three-judge Forest Bench headed by Chief Justice of India S H Kapadia said it would look into the matter from the larger perspective instead of going into individual cases after studying the report by the CEC on illegal mining by six lease holders in the Ananthapur-Bellary area. Indicating that its priority would be to save the forests in the region, the Bench observed: ‘’We will look into the larger issues.’’

Pointing out in no uncertain terms that the “first renewal period of mining lease on 29.5 hectares of OMC actually expired on December 13, 2004,” the CEC report said “the permission granted by the state of Andhra Pradesh to treat the mining lease valid up to April 25, 2017, is illegal and needs to be set aside.’’

Justifying its findings that the mining firms have transgressed the boundaries allotted to them, the CEC report said: ‘’The area as well as the boundaries of the mining lease of 68.5 hectares granted to OMC differs materially from what has been approved under the Forest (Conservation) Act, 1980. The lease executed by OMC therefore needs to be cancelled’’.

The committee has recommended cancellation of all mining operations, including transportation of mined material until the boundary between Karnataka and Andhra Pradesh was determined, the boundaries of all the lease holders were decided, adequate compensation for illegal mining was paid to the Compensatory Afforestation Fund (CAMPA) for planting trees in denuded forests and an effective monitoring system put in place to check any illegal mining in the future.

Among the other recommendations that the CEC has made are no mining operation within 50 metres on either side of the Karnataka-Andhra Pradesh border and demarcation between the reserved forest areas should remain untouched.

Taking the stand that “the sorry state of affairs” could not have taken place without the active connivance of the concerned officers of the Andhra Pradesh government, the CEC said “the almost non-existent monitoring mechanism largely contributed to the large scale illegalities”.

The report said that the plan attached with the common boundary mining agreement between M/s Bellary Iron Ores Pvt Ltd (BIOP) and M/s OMC clearly established that the Reddys’ firm worked illegally in the reserved forest area and outside its lease boundary. The OMC, BIOP and Y Mahabaleshwarappa & Sons (YMS) have “used forest area outside the approved lease boundary for dumping overburden in violation of the provisions of the Forest (Conservation) Act, 1980,” the report, prepared by a committee comprising its Member Secretary M K Jiwrajka, Member Mahendra Vyas and advocate A N D Rao, who is assisting the court as amicus curiae, said.

On the Supreme Court’s direction, the committee probed the legality of mining operations by the companies which were granted six leases to mine iron ore in the Obalapuram Reserve forest in Andhra Pradesh.

The report revealed that the mining barons had crossed their allotted boundaries and transgressed into the forest areas.