Andhra Pradesh Chief Minister Kiran Kumar Reddy on Thursday annulled the allotment of 10,760 acres land to Brahmani Industries, promoted by disgraced ex-Karnataka minister Gali Janardhan Reddy who is currently now in jail in connection with illegal iron mining.

The land, in Jammalamadugu mandal in Kadapa district, was allotted to Brahmani Steels Limited (BIL) in June 2007, when Dr Y. S. Rajasekhar Reddy was the chief minister of the state.

The chief minister's office said in a statement, "Chief Minister N Kiran Kumar Reddy today approved the proposal to cancel alienation of 10,760.66 acres of land to Brahmani Industries in Kadapa for failure to establish an integrated steel plant."

The government had allotted the land plus an iron-ore mine in Ananthapuram district in a bid to help the company set up a steel plant and boost growth in the backward region.

But, Janardhan Reddy's company made allegedly pocketed huge profits by exporting iron-ore from the allotted mine without taking any action to set up the promised steel plant.

Furthermore, BIL mortgaged the land to a private-sector bank to raise a whopping loan of Rs 350 crore.

BIL was initially classified as a mega project, and allotted a number of incentives the Andhra Pradesh Industrial Promotion Policy 2005-10.