The CBI, in its chargesheet, claimed that between 2007 and 2010, the Obulapuram Mining Company, which is owned by Gali Janardhan Reddy, had earned Rs 4,310 crore revenues by way of local sales and exports through illegal mining. Interestingly, the OMC earnings, dropped to about Rs 700 crore during 2009-10 from about Rs 2,316 crore during 2007-08.

This is mainly due to the drop in the price of iron ore from Rs 3,968 per tonne during 2007-08 to Rs 1,758 after 2008. OMC earned Rs 2,316 crore during 2007-08 due to heavy demand for iron ore in China in view of Beijing Olympics but the prices dropped later.

Three mining companies — Bellary Iron Ore Private Limited, Obulapuram Mining Company and Y Mahabaleswarappa and Sons — obtained exemption from the state government from obtaining forest licence for the transport of extracted iron ore. As per law, mining firms should have permits both from the mining and geology department and the forest department to transport ore mined from one place to the other. The forest department failed to check illegal mining as the companies didn’t obtain any permit from it but transported the ore only with the permits issued by the assistant director of mines, Anantapur. The CBI, in its chargesheet, said that the government had granted the firms exemption from obtaining forest permits despite opposition from the field officers.