The protesters began assembling in front of three gates of the secretariat since 6 AM and raised slogans against the minister.
The Secretariat houses offices of ministers and bureaucrats.
Only the cantonment gate was spared by the protesters to enable ministers and staff to enter the premises.
The protesters drawn from four districts of Kollam, Alappuzha, Pathanamthitta and Thiruvananthapuram, also wanted action against the Congress leaders named in the judicial commission report on the Solar scam.
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"Chief Minister Pinarayi Vijayan should explain why he is protecting Chandy even though all legal advices connected with the issue are against the minister," he said.
Party general secretary, A N Radhakrishnan said the party would launch a series of agitations on the Chandy issue.
Chief Minister Pinarayi Vijayan should seek Chandy's resignation, he said.
Later, a BJP delegation led by Rajasekharan met Governor P Sathasivam and submitted a memorandum demanding his resignation.
They also appraised the governor of the recent incidents of political violence against BJP cadres in the state.
A crucial meeting of the LDF held here yesterday had decided to entrust Vijayan with taking an appropriate decision on the Chandy issue.
NCP nominee, Chandy, a businessman-turned-politician, was inducted into the state cabinet eight months ago following the resignation of A K Saseendran after a purported sleaze audio clip with a woman went viral.
Congress-led UDF and BJP demanded Chandy's resignation after Alappuzha district collector T V Anupama confirmed that a paddy field had been reclaimed for laying the road to his resort. Besides the backwaters were also allegedly encroached to construct a parking space for the resort, according to the collector's report.