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Updated: May 6, 2012 10:16 IST

Srilakshmi's assets under CBI scanner

N. Rahul
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Suspended IAS officer Y. Srilakshmi
Suspended IAS officer Y. Srilakshmi

The CBI has informed a court here that it was investigating properties belonging to suspended IAS officer Y. Srilakshmi, which were reportedly held in the name of her brother-in-law M. Rakesh Babu.

It was found that Mr. Rakesh acquired huge properties in the years 2005-09 when Ms. Srilakshmi was industries secretary but his sources of income were not matching, the CBI told court during arguments on her bail application.

The investigating agency also said it proposed to question K. Mehfuz Ali Khan, personal assistant of former Karnataka Minister Gali Janardhan Reddy, who is lodged in a jail in Bangalore to ascertain “heavy” pay offs to Ms. Srilakshmi. Its petition to shift Mr. Khan here on prisoners transit warrant is pending in court.

Rejection letters

Making a detailed submission on the role of Ms. Srilakshmi in the Obulapuram Mining Company (OMC) scam, CBI counsel B. Ravindranath said she deliberately reduced the response time for unsuccessful bidders of a mining lease to show cause why their applications should not be rejected. This was done to synchronise issue of orders for sanction of two leases on the same day. Even the rejection letters were despatched to the bidders the same day.

The reason cited for rejecting the bid by Satavahana Ispat Limited which had a steel factory in Anantapur since 1992 was that the company did not acquire a single lease to explore iron ore for captive purpose. On the contrary, OMC was a “prudential entrepreneur” with foresight as it acquired leases to feed stock for its proposed steel factory in Kadapa.

Mounted pressure

After the issue of orders, Ms. Srilakshmi mounted pressure on the staff of land survey department to act according to the wishes of OMC. She also approached the then Mines Minister P. Sabita Indra Reddy to grant a third lease to OMC but was snubbed by the latter, Mr. Ravindranath argued.

Denying this, the defence counsel V. Surender Rao said the Minister nursed a grouse against his client because she scuttled the prospects of the third lease to OMC.

The Minister would have got the lease sanctioned to OMC because of her close rapport with YSR if Ms. Srilakshmi had forwarded the file to her.

The court also heard the bail plea of Mr. Gali Janardhan Reddy where it was argued by his lawyer that the request be conceded since there were no immediate prospects of commencement of trial in the case.

mounted pressure on the staff of land survey department to act according to the wishes of OMC

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