Supreme Court stays probe against TASMAC, says ED crossing all limits

The apex court slammed the Enforcement Directorate (ED) over the raids

The Supreme Court on Thursday stayed the Enforcement Directorate's money laundering probe and raids against Tamil Nadu-run liquor retailer Tamil Nadu State Marketing Corporation (TASMAC).

A bench comprising Chief Justice BR Gavai and Justice Augustine George Masih slammed the Enforcement Directorate (ED) over the raids, saying it was crossing "all the limits" and violating the federal concept of governance. It said ED was acting in violation of the  Constitution by initiating action against a government body, according to a report by Bar and Bench.

The apex court also issued a notice to the probe agency on Tamil Nadu government's petition against the Madras High Court order which had allowed the ED probe to proceed in the alleged Rs 1,000 crore scam in TASMAC.

"Your ED is crossing all the limits," CJI Gavai remarked.

Granting a stay on the proceeding, the court sought an explanation over what the predicate offence was. "The Enforcement Directorate is violating the federal concept (of governance),” the bench observed.

Senior advocate Kapil Sibal, representing the state, informed the apex court that Tamil Nadu had itself filed 41 FIRs against individuals linked to liquor outlet operations for alleged corruption between 2014 and 2021 and the ED suddenly jumped in. "The ED comes into picture in 2025 and raids the corporation (TASMAC) and the head-office. All phones taken, everything taken. Everything cloned," he said.

The ED case stems from allegations that distillery companies siphoned off unaccounted cash, allegedly used to secure more supply orders from TASMAC.

The DMK-run state government and TASMAC moved the top court against the raids conducted by the ED at the premises of TASMAC.

The pleas challenged an April 23 order of the Madras High Court dismissing its pleas giving the go ahead for the ED action.

The ED was allowed to proceed with its action under the Prevention of Money Laundering Act (PMLA).