Reddy Brothers Mining Scam, Karnataka Lokayukta Full Report.

Reproduced here is Lokayukta Santosh Hegde‘s Report in full for reference.

Report:

The following document is a 466-page summary of a more than 25,000-page report compiled by the Indian government’s Karnataka Lokayukta or People’s Commissioner who investigated years of illegal activities in the Indian mining sector, including widespread corruption, bribery and the exportation of illicit iron ore worth more than $3 billion.  The report has met with widespread controversy due to its singling out of a number of prominent billionaires in the Indian mining industry.  For more information, see the Wall Street Journal’s article on the report.

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Ref: (i) Govt. Notification No. CI 164 MMM 2006,
dated 12/03/2007
(ii) Govt. Notification No. CI 164 MMM 2006 (Part),
dated 09/09/2008
(iii) Govt. Notification No. CI 164 MMM 2006 (Part),
dated 24/12/2008 and
(iv) Government Order No.CI 164 MMM 2006 (Part),
dated 19/07/2010
– – – – –
In exercise of powers conferred under Section 7(2-A) of the
Karnataka Lokayukta Act, 1984 (hereinafter referred to as the
‘Act’), the Government of Karnataka, had referred the following
issues for investigation and for submission of a report by the
Lokayukta to the Government with specific recommendations,
vide Government Order No. CI.164.MMM.2006 dated
12/03/2007. The scope of investigation, as per the said
Government Order, covers the period from 01/01/2000 to
22/07/2006. Subsequently, vide G.O. No. CI 164 MMM 2006
(Part), dated 09/09/2008, the scope of investigation was
extended till 09/09/2008 and vide No. CI 164 MMM 2006 (Part),
dated 24/12/2008, the scope of investigation was further
extended till 24/12/2008. Thereafter, vide No. CI 164 MMM
2006 (Part), dated 19/07/2010, the scope of investigation is

further extended till 19/07/2010, after including one more term
of reference, in addition to those contained in the G.O. dated
12/03/2007. The terms of reference as per G.O. No. CI 164
MMM 2006, dated 12/03/2007 are as follows:

….

The difference
between permit issued and export made for the said
period comes approximately to 2,98,60,647 MT. This
is the illicit iron ore exported during 2006-07 to
2010 (till December) from the ports as mentioned in
Para 1.
3. It is stated here that there is an approximate
quantity of 32,44,219 MT of iron ore, where there is
an ambiguity with regard to exact destination to
specific ports. However, giving the benefit of doubt
this quantity has been subtracted from the total
quantity of export of illicit iron ore and the quantity
in Para 2 has been arrived accordingly.
4. Out of the 5 Financial Years for which
computations have been done, the highest quantity
of exports of illicit iron ore has taken place in Year
2009-10, which is approximately 1,27,99,396 MT.
Further it is equally pertinent to note that in Year
2010-11( when permits for destinations for exports
were issued for 4 months), the quantity of illicit iron
ore that was exported was approximately 48,06,719
MT, which is higher than the exports of illicit iron
ore for entire year of 2006-07, 2007-08 and almost
equal to the entire year of 2008-09. This indicates
the continuity of magnitude of exports of illicit iron
ore even after the raids conducted by the Lokayukta
at Belekeri in February 2010 and the issue widely
reported in the media.
5. The approximate loss to the state government
due to illegal exports comes to approximately

Rs.1,22,28,14,22,854 for the above said period.
The loss is calculated by taking the yearly average
export rates / MT from all the ports.
6. The loss to the tune of Rs. 1,22,28,14,22,854
caused to the state government due to illegal iron
ore exports for the period should be recovered from
the exporters/suppliers/traders/lessees and others
after following due process of law…….

Name of the Lease from which the iron ore was
allegedly transported: S.B Minerals, Lease No.
2515.
As per the electronic records seized, a total of 410.5
MTs of iron ore was supplied, between 26th
October
and 12th
November 2009, at SMSPL’s Plot in
Belekeri port, in the name of DLC SVK. The term
“SVK” clearly indicates that the material has come
from SVK Mines, belonging to lessee SB Minerals,
lease No.2515. On verification, it is found that no
permits for Belekeri were issued from the said lease,
with DLC as party, during the above mentioned
period. This indicates that the iron ore was illicit.
e) Name of the Stockyard from which the iron ore
was allegedly transported: Dream Logistics:
As per the electronic records seized, a total of
1,37,954.71 MTs of iron ore was supplied between
29th
October and 3rd
December 2009 at SMSPL;s
Plot in Belekeri port, in the name of JUNJUNBAIL
DLC, (S2), (S3), (S3A). The term “JUNJUNBAIL”
clearly indicates that the material has come from the
stockyard of “Junjunbail belonging to Dream
Logistics (DLC). On verification it is found that no
permits for Belekeri were issued from the said
stockyard, with DLC as party, during the above
mentioned period. This indicates that the iron ore was illicit.

http://info.publicintelligence.net/IndiaMiningCorruption.pdf

http://publicintelligence.net/indian-karnataka-lokayukta-peoples-commissioner-report-on-mining-industry-corruption/