The Supreme Court on Friday expanded the probe against the former Karnataka Minister, G. Janardhana Reddy, asking the Central Bureau of Investigation to go into the link between mining activities in Karnataka's Bellary district and Obulapuram mines in Anantapur district, Andhra Pradesh.

A Forest Bench, comprising Chief Justice S.H. Kapadia and Justices Aftab Alam and Swatanter Kumar, accepting the report of the Central Empowered Committee seeking a CBI probe, said: “The CBI investigation was needed as it was prima facie satisfied with the material placed before it, that the iron ore extracted by two companies, Associated Mining Company [AMC] and Deccan Mining Syndicate [DMS], was being illegally routed through Obulapuram.”The Bench took into consideration amicus curiae Shyam Divan's submission that AMC was owned by Mr. Reddy and his wife, while another mining baron S.M. Jain was the owner of DMS.

The Bench said: “We also prima facie found that the material [ore] extracted by AMC and DMS is being routed through Obulapuram. It is for this reason we are issuing notice to the CBI. We want the CBI to investigate this aspect of linkage.”

The court directed the CBI to file a status report next week on the investigation conducted against the Reddy brothers in respect of alleged irregularities in mining in the OMC pursuant to its registering a first information report.

The CEC said: “It is constrained to mention that the Karnataka Lokayukta has made scathing observations on the series of grave illegalities committed by AMC and the undue favour shown to it by officials of Karnataka. These include the issue of a transit pass by the Forest department for transportation of more than half a million tonne of iron ore without payment of about Rs. 192 lakh in forest development tax.”

During 2009-10, the production of about one million tonnes of iron ore had been shown to have taken place from the mining lease of 10.12 hectares, the report said. “It is not possible to attain such a high level of production considering the small size of the lease area. In all probability, the transit permits were used for transportation of ore illegally mined from other areas.”

The report noted that a joint team, which inspected the mines, found serious illegalities in grant of renewal of mining lease; the existing locations of boundary pillars being completely different from the sanctioned lease sketch, and the quantity of iron ore shown to have been produced and dispatched from the mining lease being far in excess.

The Bench posted the matter to September 30.