#BREAKING: Setback for ED! Madras High Court Halts ED’s TASMAC Probe, Seeks Transparency

The Madras High Court on Thursday issued an oral directive to the Enforcement Directorate (ED), instructing it to suspend further action following its recent searches at the Tamil Nadu State Marketing Corporation (TASMAC) headquarters in Chennai.

The court also ordered the ED to submit copies of the First Information Report (FIR), Enforcement Case Information Report (ECIR), and any supporting materials by March 24, as it scrutinizes the agency’s investigation into alleged financial irregularities worth Rs 1,000 crore.

A division bench of Justices M S Ramesh and N Senthilkumar postponed further hearings on petitions filed by TASMAC and the Tamil Nadu government to March 25. The state entities challenge the ED’s raids, conducted on March 6, arguing they breach federal principles without state consent. TASMAC further demanded protection for its employees, alleging harassment during the searches.

Advocate General P S Raman, representing the state, asserted that the ED lacks authority to conduct such operations without Tamil Nadu’s approval, a stance the bench questioned, prompting Raman to seek time to refine the petition’s prayer. Senior counsel Vikram Choudhry, for TASMAC, criticized the raids as opaque and invasive, citing seized digital devices and detained staff—including women—for hours. He invoked Section 17(1) of the Prevention of Money Laundering Act (PMLA), insisting that searches require documented evidence of money laundering, communicated to affected parties, which he claimed was absent.

Additional Solicitor General A R L Sunderesan refuted these accusations, defending the ED’s actions as lawful responses to a money laundering offense. Raman countered with plans to present CCTV footage proving staff confinement, escalating the dispute.

The ED earlier alleged “multiple irregularities” in TASMAC’s operations, including tender manipulation and unaccounted cash transactions worth Rs 1,000 crore via distilleries, with evidence of kickbacks uncovered during the raids. The court’s interim order and demand for records signal a critical review of the ED’s probe, balancing federal tensions and procedural integrity.