Reddy Bros exported iron ore to their own firm!
The Lokayukta report has assessed that Rs 215.12 crore has been stashed away by Reddy brothers in tax havens. Vital evidence has been unearthed that suggested that Reddy Bros had allegedly diverted funds to overseas destinations through illegal means from their Obulapuram Mining Company (OMC).
The report said the OMC had exported about 20 consignments to GLA Trading International in Singapore, though the major destination for iron ore trade is China. GLA was established on November 30, 2007, with G Janardhana Reddy as one of its directors. GLA, with a share capital of $1, has its offices in the tax havens of Singapore, Dubai and the British Virgin Islands.
Records revealed that OMC has exported to its own Singapore entity GLA for a much lower price. For the similar grade of iron ore, OMC had under-invoiced at $94 per tonne, while it exported it to GLA in Singapore and GLA, in turn, sold it to the top grain minerals, Maco Commercial, at $152 per tonne – a clear difference of $58 per tonne.
The report said there are 478 suspected cases of under-invoiced exports during the period 2006-2010 amounting to over Rs 2,222 crore.