A special anti-money laundering court in New Delhi has attached assets worth over Rs 37.86 crore belonging to former Karnataka minister and mining baron Gali Janardhan Reddy and his wife in connection with an alleged multi-crore iron ore mining scam.
The assets, which include a Rs 4 crore flat in Bangalore, a Rs 14 lakh house in Bellary, fixed deposits and cash in bank accounts, were attached by the Enforcement Directorate earlier this year under the provisions of the Prevention of Money Laundering Act.
The central agency had in 2012 registered a case against the minister and others and undertaken criminal action against him and his wife G Lakshmi Aruna in connection with its money laundering probe into the business operations of M/s Associated Mining Company (Guru Iron Ore mines) based in Havambhavi in Bellary district of Karnataka.
The total value of the seized assets is Rs 37,88,66,108.70.
"After careful consideration of the material placed before me, including the FIR, charge sheet filed by CBI and the submissions by the learned counsels, I am convinced prima facie that the defendants (Reddy and wife) had committed scheduled offences, generated proceeds of crime and ploughed them into properties provisionally attached," the court of the Adjudicating Authority for PMLA and Chairman, K Raamamoorthy, said in its latest order.
The court is the nodal judicial body set up to decide cases of enforcement and money laundering.
According to the ED complaint, Reddy and his wife allegedly "made wrongful gains to the tune of Rs 480 crore" in the case and the assets which have been attached constitute the "proceeds of crime" of laundering.
The agency took over the probe into the case based on a CBI FIR filed earlier.
The ED complaint states that Reddy and his wife "took over" the company, having leasehold rights of Mining Lease No.2434, by becoming partners in M/s Associated Mining Company on July 31, 2009, through an admission deed.
The probe agency said that the iron-ore mining company, however, did not carry out any mining operation in the leasehold area of ML No.2434.
The agency, during its investigation, found that in the returns filed by the said firm with the Deputy Director of Mines and Geology, Hospet, 6.28 lakh metric tonnes of iron ore was shown to have been mined and dispatched from the mine area during the period August 2009-March 23, 2010.
ED recorded in its complaint that a scientific survey conducted by CBI in the area specified estimated that the iron ore excavated between July 22, 2009, and April 21, 2012, could only be about 1,33,373 metric tonnes.
"Thereby, the claim of Reddy and Lakshmi Aruna that 6.28 lakh metric tonnes was excavated from August 2009 to March 22, 2010, was proved wrong," the ED has recorded in its complaint.
This is one of the many attachments the agency has effected against Reddy in the case. An attachment under PMLA is aimed at depriving the accused of his or her ill-gotten wealth.