The rise and fall of Madurai’s Granite Mafia --tehelka.com Jeemon Jacob

The two-decade long reign of the mining barons in the region has come to an abrupt end, after a former district collector’s letter to the chief minister was leaked to the media, reports Jeemon Jacob
Until two weeks ago, they were a privileged class in Tamil Nadu. For nearly two decades, the granite barons of Melur Taluk in Madurai have wielded immense clout in the state and boasted of money, mafia and political power. With both the DMK and the AIADMK extending their patronage to the industry, successive governments showered them with all they wanted.
But the recent arrests in Melur following the former Madurai district collector’s letter to the chief minister on the scale of illegal mining in the district has come as a bolt from the blue for the mine owners.
The Madurai Police has registered 18 cases against mining barons in the region; arrested 40 persons; issued look out notices against 12 persons including Dayanidhi Alagiri, son of Union Minister MK Alagiri; banned export of granite; sealed 10 buildings; conducted 37 searches; seized Rs 17.17 lakh and 72 vehicles; sealed explosive godowns; suspended 12 revenue officials; and the Directorate of Vigilance and Anti-corruption has ordered probes against another 40 officials in various other departments. Raids and arrests are still on.
In 1992 J Jayalalithaa as the chief minister ended the state’s monopoly over granite mining, allowing private quarry owners to enter the granite-mining sector. Till then Tamil Nadu Minerals Limited (TAMIN), established in 1978, had a monopoly over mining rights in the state. Following the change in policy, the state government leased out land and issued nearly 200 licenses to private companies for mining granite.
According to Anshul Mishra, district collector of Madurai, of the 175 licensed granite quarries in the district, 94 quarries have violated license norms, while 51 others have committed major violations, including encroaching revenue land and private land.
“We are continuing our searches and trying to assess the loss in terms of money. But it’s a huge task. We have deployed 200 government officials and 100 police personnel for the job. All the quarry owners have illegally mined granite blocks over and above the permitted quantity. They mined public roads and private lands without the consent of the owners and have grabbed land at will,” Mishra says.
The police have unearthed huge stocks of granites hidden in various quarries in Melur. They found 22,000 granite blocks hidden away in Keelaiyur, and another 23,730 blocks in Keelavalavu, just within a four-km radius around Melur.
“Our investigations in Madurai district reveal that 70 percent of violations were committed by PRP Granites Exports Ltd”, he added.
Unofficial estimates peg the loss to exchequer at more than Rs 1,00,000 crore. PRP Granites, run by PR Palanisamy, is the largest granite exporter in the country.
From a school drop out from Andipeti village in Theni district of Tamil Nadu, Palanisamy today commands a Rs 25,000-crore business empire spread across the globe. He holds more than 800 acres of land in his family name and another 400 acres of benami property. But police officials estimate, his family holds more than 2300 acres of land in Tamil Nadu. The vast business empire has been created within a short span of a decade. He has won the top exporter award from CAPEXIL(Chemical and Allied Export Promotion Council of India), under the Union Ministry of Commerce and Industry, eight times, and the Indian Chamber of Commerce and Industry’s best exporter award twice.
Simon Raj, an auditor based in Madurai, says, “The district administration is talking only about Madurai. Granite quarrying is done in other districts such as Salem, Krishnagiri, Nammakkal, Dharmapuri, and Mettur too. So the granite scam account may even surpass the 2G scam.”
Those who tried to raise their voices against granite business in the district were silenced, often brutally beaten up. Journalists who wrote against the mining barons were arrested, jailed and tortured.
On 21 July 2010, Madurai police arrested Dina Bhoomi editor S Manimaran and his son M Rameshkumar based on a complaint lodged by P Periyasami, president of Madurai Granite Quarry Owner’s Association. Periyasami alleged that the newspaper had extorted Rs. 5 lakh from the quarry owners and had published misleading news about the granite business. Cases were registered against Manimaran, his son, Rameshkumar and M Muthaih of Keelayur village under the Indian Penal Code section 341 (punishment for wrongful restraint), 384 (extortion) 387 (causing fear of death) 294 b (obscene acts in public) and 392 read with 511 (robbery and attempt to commit criminal offence). The journalists were arrested from their home and then let off on bail on 22 July after the media campaigned for their release.
Dina Bhoomi, a local Tamil daily, had published a series of articles about the granite loot in Keelayur and neighbouring villages.
“PRP was distributing regular monthly gifts to all officials who kept a blind eye to its business. District Collectors used to get Rs 5 lakh monthly. Officials in the mining and police departments, from top to bottom, get packets according to their ranks. Police officials, from Inspector General to Inspectors were given packet matching their ranks. PRP has gifted a luxury car to a police official in the rank of Deputy Superintendent of Police,” says a police official not wishing to be named.
According to Simon Raj, “The looting has been going on for the past two decades as nobody verified the accounts submitted by granite firms. You don’t need great auditing skills to unearth this scam. Just add export volume and local sales. Also, verify the royalties paid to the government by the companies for the blocks they had mined. There will be vast differences in the figures. That speaks of the magnitude of the scam.”
Before Manimaran exposed the looting spree, a local businessman in Melur had exposed illegal mining in the region through an RTI in 2008. S Murugesan, a local, used RTI effectively to expose the granite loot in his locality. The 58-year-old activist approached the Deputy Director, Mines and Geology, and the Commissioner of Customs, Tuticorin to provide information about the due clearance certificate given to PRP Granites Exports Ltd regarding the granite slabs exported by the firm during 2004 -08.
The RTI reply revealed that PRP Granites had paid Rs 12.38 crores as royalty to the Mining Department between 2004-08 and exported 78,661 cubic meters of granite blocks. The royalty levied from the granite company was at Rs 1,575 per cubic meter. But commissioner of central excise and customs stated that PRP has exported 4 lakh cubic meter granites from Tuticorin port during 2004-08. The mismatch in the official documents revealed the loot. The difference was more than five times above the permitted number.
Murugesan petitioned against PRP Granites before deputy director of mines and the district collector regarding illegal mining in various quarries in Melur. He then filed a writ plea before the Madurai Bench of Madras High Court demanding action against granite loot in Melur area on 2009 September 30.
But the then district collector N Mathivanan filed a counter affidavit and prayed to the court to dismiss Murugesan’s petition as it was devoid of merits. Other government departments too helped the granite barons by filing similar counter affidavits. The court directed the district collector to conduct the probe on the allegation levelled by the petitioner on 4 February 2011.
“In fact, I had given documents to Dina Bhoomi about the granite scam. On the basis of my documents, they had published the news. The police was about to arrest me with Mathimaran and his son. If they had arrested me, they would have killed me,” Murugesan says.
After the 2011 Assembly elections, the then district collector U Sagayam deployed 18 teams to conduct investigations regarding the illegal granite mining in Melur. On 1 May, Sagayam visited the granite quarries and found large-scale illegal mining in Melur area.
On May 17, Sagayam submitted his report to the state government in Chennai about his findings and met the Chief Secretary Debendranath Sarangi on 22 May and briefed him about the gravity of situation. However, while he was boarding the flight from Chennai to Madurai, he was told that he was transferred from Madurai. The granite barons celebrated his transfer in style.
But their jubilation didn’t last long. After Anshul Mishra took over, he started deploying teams and registering cases against granite firms that violated lease agreements.
According to him, it was after Sagayam’s report leaked to the media, government initiated action against illegal granite mining firms.
“The Chief Minister wanted to trap Alagiri’s son Dayanidhi in granite scam. Now he is on the run. PRP was trapped in between. If the government was keen to crack down granite lobby, it would have started similar operations in other districts, “said an AIADMK leader not wishing to be named.
But the crackdown has its worst impact on granite barons who are on the run. They are shaken to the roots and fear for the worse.
Jeemon Jacob is Bureau Chief, South with Tehelka.
jeemonj@gmail.com