MML scam: Minister says books were fudged, but ore not exported

Mines and Geology Minister Vinay Kulkarni on Wednesday admitted that books of the Mysore Minerals Limited (MML) were fudged to misreport the quantity of iron ore produced and, said a detailed inquiry by an IAS officer has been ordered.

This comes days after JD(S) state president H D Kumaraswamy accused Chief Minister Siddaramaiah of abetting illegal mining in the state-run MML, where an internal probe confirmed manipulation of records.

"There's a kaccha book that is maintained in the mines , where the number of trucks making trips is recorded. It is in this book that quantity of the iron ore production was arbitrarily entered, which was different when it was measured at the time of processing," Kulkarni told reporters. "In some cases, the production figure was increased to show the Indian Bureau of Mines (IBM)."

Kulkarni said the kaccha book was not a valid record and that payment was made based only on the weighed quantity of processed ore.

From the Thimmappanagudi and Subbarayanahalli mines, Kulkarni said the MML had produced 61 lakh metric tonnes (MT) of iron ore so far of which 56.83 lakh MT had been sold. "The remaining 4 to 5 lakh MT are being processed," he said. He added that a weighbridge had been installed two months ago "to ensure materials are weighed before coming out of the mines."

He  dismissed Kumaraswamy's claim that the misreporting had paved the way for export of illegal iron ore. "The variation is true, but nothing has gone out of the mines. There's a ban on exports. It's not easy to transport the materials out. Also, it is only after verification by our department and the IBM that the ore is auctioned," Kulkarni said.

The minister challenged Kumaraswamy's figure of Rs 5,450 crore worth of iron ore production, which is based on Rs 3,000 per ton and by multiplying by three the figure of 60.56 lakh MT that was reported to the IBM between 2014 and 2016. "It's not possible to produce that amount of iron ore from our mines. Also, the Rs 3,000 per ton is an incorrect price."

According to Kulkarni, in 2014, the Supreme Court allowed MML to mine up to 30 lakh MT of iron ore from Subbarayanahalli and 10.6 lakh MT from Thimmappanagudi. "The production target was 40 lakh MT. In 2015, the contractor managed to produce only 16 lakh MT.  A penalty should have been levied for the shortfall, but it was not done.  It was me who ordered an inquiry. At least, now we know what was going on."