ED attaches Rs 80 crore assets of firm linked to Telangana MLA

Hyderabad, Nov 24 The Enforcement Directorate (ED) said on Monday that it has attached Rs 80 crore worth of assets of Santosh Sand and Granite Supply owned by the brother of Telangana MLA Gudem Mahipal Reddy in an illegal mining case.

The Hyderabad Zonal Office of the ED has said that it has provisionally attached several immovable and movable properties amounting to Rs 80.05 crore under the provisions of the Prevention of Money Laundering Act (PMLA), 2002, in connection with an ongoing investigation in a case related to illegal mining by Santosh Sand and Granite Supply.

The central agency had initiated investigation on the basis of FIRs registered by Patancheru Police in Telangana wherein it was alleged that Santosh Sand and Granite Supply represented by its proprietor Gudem Madhusudhan Reddy and others have cheated the state government by carrying out excess mining in the assigned quarry area and also carrying out illegal mining in unassigned government land, thereby causing huge revenue loss to the government to the tune of Rs 39.08 crore towards royalty payable and by wrongfully enriching themselves to the tune of Rs 300 crore from the illegal mining carried out by them.

During the course of investigation, searches were conducted by the ED which, among other things, resulted in the seizure of numerous original property documents from the possession of Gudem Madhusudhan Reddy.

Further investigation revealed that though these properties were in the names of different persons, the beneficial owner of these properties is Gudem Madhusudhan Reddy.

Examination of the purported owners of these properties revealed that they were benami properties of Gudem Madhusudhan Reddy, the ED said.

It was further said that the mining license was granted by the state government to Santosh Sand and Granite Supply and they, in turn, sub contracted the same to GVR Enterprises, a partnership firm of Gudem Madhusudhan Reddy and G. Vikram Reddy.

This sub-contracting was not permitted in terms of the lease and moreover no permission was taken from the state government.

The ED investigation also said that the illegally mined products were majorly sold in cash and the proceeds of crime (POC) generated in this manner were further invested in properties, mostly in the names of benami property.

Accordingly, 81 such properties, valued at Rs 78.93 crore have been provisionally attached during investigation.

"Some amounts were also due to GVR Enterprises from the purchasers of illegally mined material and these amounts also represent the POC and accordingly fixed deposits of Rs 1.12 crore in the names of these entities have also been attached. Further investigation is underway," the central agency added.

Gudem Madhusudhan Reddy is the brother of Gudem Mahipal Reddy, the MLA from Patancheru constituency in Sangareddy district.

The ED had questioned both the brothers in July last year following raids at seven locations associated with them.

In 2023, Mahipal Reddy was elected to the Assembly for third consecutive term on Bharat Rashtra Samithi (BRS) ticket.

Mahipal Reddy is one of the 10 BRS MLAs who switched loyalties to Congress last year and are currently facing disqualification proceedings.

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