In a significant rebuke, the Supreme Court of India has come down heavily on the Enforcement Directorate (ED) for its aggressive actions targeting Tamil Nadu’s state-run liquor corporation TASMAC, cautioning the agency against breaching the federal structure of governance. The apex court directed the ED to suspend further proceedings, raising serious concerns over the agency’s conduct during its raids in the state.
SC slams ED for overreach, pauses probe
A bench led by Chief Justice BR Gavai termed the ED’s operations as “crossing all limits”, particularly its raids conducted in March and again in May at various TASMAC-run liquor outlets. The court stated that while action against individuals might be acceptable, taking sweeping actions against state corporations could not be condoned.
“You may register cases against individuals… but corporations? Your ED is passing all limits!” the bench observed. The court granted a stay on further proceedings and issued notice to the ED, returnable after the court’s vacation.
State government challenged Madras High Court order
The Tamil Nadu government and TASMAC approached the top court challenging an earlier Madras High Court decision dated April 23, which had permitted ED to proceed with its probe. The petitioners claimed that the ED’s moves were politically motivated and in breach of constitutional principles.
DMK welcomes Supreme Court order
Reacting to the apex court’s intervention, senior DMK leader and former Rajya Sabha MP RS Bharathi said the ruling was a blow to the political efforts aimed at tarnishing the state government’s image. The ruling DMK has consistently maintained that the ED’s actions are part of a wider attempt to malign the state ahead of elections.
ED allegations: ₹1,000 crore unaccounted cash, irregularities in tenders
The ED, during its raids conducted under the Prevention of Money Laundering Act (PMLA), had earlier claimed to unearth significant irregularities within TASMAC operations. These included alleged manipulation in the grant of bar licences, corrupt practices in the transportation of liquor, and coordination with private distilleries and bottle suppliers to siphon off public money.
It further alleged the recovery of incriminating data related to the tender process, including overpriced surcharges imposed per bottle sold, reportedly with the involvement of TASMAC officials. The agency claimed it had evidence of manipulated financial records during the award of indent orders and tenders.
ED accused of political vendetta
Following the raids, Tamil Nadu Excise Minister S Muthusamy accused the ED of harassing state officials under the guise of investigation. He questioned the timing and motives behind the searches, asserting that no conclusive evidence was found and that the agency’s efforts were aimed at tarnishing the image of the DMK-led government.
This echoed a broader narrative often raised by opposition parties that central agencies are being misused by the ruling party at the Centre to target non-BJP ruled states, particularly in the run-up to elections.
BJP alleges ministerial involvement
Meanwhile, BJP leader and former state president K Annamalai accused Tamil Nadu minister V Senthil Balaji of being the central figure in the alleged scam. Claiming corruption to the tune of ₹1,000 crore, he alleged that Balaji was “involved in every single scam” and referred to separate court proceedings naming him.
Balaji, however, categorically denied the charges, asserting the transparency of TASMAC’s procurement and pricing mechanisms. He clarified that purchase orders were issued based on long-term average demand calculations, with no room for bias or favouritism.