Tamil Nadu’s Tasmac case decoded: Why BJP is protesting against alleged Rs 1,000 crore scam

What is Tasmac?

Tasmac was established in 1983. It is the sole authority responsible for liquor sales in Tamil Nadu. The state government holds a complete monopoly over both wholesale and retail liquor distribution, making Tasmac one of its largest revenue sources.

What is Tasmac scam?

According to the Enforcement Directorate (ED), there were "multiple irregularities" in the operations of Tasmac, including "manipulation" in the tender processes and "unaccounted" cash transactions worth Rs 1,000 crore through distillery companies. The probe agecy reportedly unearthed a nexus involving state minister V Senthil Balaji and other senior politicians of the ruling DMK.

Balaji currently oversees the Electricity, Prohibition, and Excise portfolios. According to the ED, raids revealed alleged collusion between officials, politicians, and distillery owners.

Distilleries across Tamil Nadu systematically inflated expenses and created fake purchases, primarily through bottle-making companies, diverting around Rs 1,000 crore into unaccounted funds and shell companies. These illicit proceeds were channelled into kickbacks to secure inflated supply orders from Tamil Nadu State Marketing Corporation Limited (TASMAC).

“During the search action in the offices of TASMAC, incriminating data related to transfer postings, transport tender, bar licence tender, indent orders favouring a few distillery companies, excess charge of Rs 10-30 per bottle by the TASMAC outlets involving the officials of TASMAC, among other evidence, have been recovered,’ read the ED statement.

According to a News18 report, evidence from the allocation of bar licence tenders by Tasmac also indicated significant manipulation of tender conditions. The tenders were awarded to applicants lacking essential documentation, such as GST/PAN numbers and proper KYC details. Further, several communications have surfaced showing direct interactions between distillery companies and senior TASMAC officials, indicating efforts to secure inflated indent orders and gain undue favours.

“A glaring issue is the mismatch between the KYC details of the applicant and the Demand Draft (DD), suggesting that the final successful bidder did not even obtain the requisite DD before the application deadline. Additionally, tenders were awarded despite having only a single applicant in the final bid. TASMAC paid over Rs 100 crore annually to transporters," the statement said.

Also, a massive financial fraud involving distillery companies—SNJ, Kals, Accord, SAIFL, and Shiva Distillery—alongside bottling firms such as Devi Bottles, Crystal Bottles, and GLR Holding, was unearthed.  This well-coordinated scheme facilitated the generation of unaccounted cash and illicit payments.

Top ED sources told News18 that their investigation, encompassing all 4,829 TASMAC outlets, has uncovered glaring discrepancies in transportation tenders. Evidence suggests that consignments meant for retail outlets were diverted, with powerful figures linked to the scheme.

What does DMK say?

Balaji recently said the report by the ED had also been released because of the DMK vs BJP battle over 'Hindi imposition' and delimitation.

"ED has given no details of the FIRs on the basis of which it has acted. There is no corruption in transfer or transportation (of cash) ... the alleged irregularities are by bottling firms outside TASMAC... Tamil Nadu government has no role in this," Balaji told reporters. "The ED is motivated... It released its statement to defame the Tamil Nadu government ahead of the budget speech. This Rs 1,000 crore corruption allegation is baseless," he said.