The CAG has squarely indicted YSR government for indiscriminately granting huge tracts of land to the Brahmani group, former Karnataka Minister Gali Janardhana Reddy's business ventures disregarding all regulations.
Among the major findings of the CAG were the irregular allotment of thousands of acres of land all of which incidentally are being probed by CBI as part of inquiry into the amassing of illegal wealth by YSR's son and Kadapa MP Y.S Jaganmohan Reddy.
The CAG, in a way, endorsed the allegations levelled by all Opposition parties in the state over the allotment of land in total violation of rules.
"An extent of 3,115.64 acres of land in Jammalamadugu mandal in Kadapa district was allotted to Brahmani Industries Ltd (of Gali Janardhana Reddy) for setting up a commercial airport and flying academy, in violation of Government of India's policy on setting up of commercial airports, and without verifying the suitability of the site and viability of the project. It overlooked the fact that the Kadapa airport was just 50 km away," the CAG report pointed out.
Although the land required for the proposed airport was only around 2,500 acres (as observed by Principal Secretary-Industries and Infrastructure Department), the extent of land alienated was 3,115.64 acres. Thus, an excess allotment of 615.64 acres was made in this case, it said.
The decision to alienate land to Brahmani Industries (BIL) was taken by the Council of Ministers (headed by YSR) even though all the facts were brought to its notice by CCLA, who had also cautioned the Government against the viability of setting up a second airport in the same area, it said.
Alienation of government land to BIL was thus injudicious and in violation of all the established rules and good practices. It clearly amounted to an undue favour to the company without any justification, the CAG observed.
Not stopping at that, another 10,760.66 acres of land in the same mandal was allotted to Brahmani Industries for a green-field Integrated Steel Plant. This involved illegal alienation of 674.58 acres of water bodies and allocation of 2 tmc feet of water from the Gandikota Reservoir without environmental clearance or independent examination of the project report. As of November 2011, even the first phase of construction had not been completed, the CAG noted.
Favours under the YSR Government were also allegedly extended to Gali Janardhana Reddy's Obulapuram Mining Company (OMC), which has figured in illegal mining activities.
The request of OMC, which had unauthorisedly occupied Government lands, for grant of lease of 413.81 acres was turned down by Anantapur District Collector in August 2008.
However, within a month thereafter, this position was reversed by the Collector who, at the request of state-run APIIC, recommended alienation of 304.66 acres of land (for transfer to OMC) for establishment of an industrial park. The reasons for reconsidering the lease or alienating the land were not recorded, the CAG observed.