The Madras High Court has issued a directive to the Enforcement Directorate (ED) to halt further actions following its recent searches at the headquarters of the Tamil Nadu State Marketing Corporation (TASMAC), the state-run liquor retailer. The court’s decision came during a hearing on Thursday, where it also ordered the ED to submit the First Information Report (FIR), the Enforcement Case Information Report (ECIR), and other relevant materials used in the case against TASMAC.
The directive follows allegations by the ED of financial irregularities amounting to approximately Rs 1,000 crore at TASMAC. The court has scheduled the next hearing for March 25, responding to petitions filed by TASMAC and the Tamil Nadu government, which argued that the ED’s actions infringed upon the principles of federalism by investigating state entities without sufficient jurisdictional basis.
During the proceedings, Advocate General P S Raman, representing the state government, argued that the ED must obtain consent from the state before conducting such searches. The court expressed initial dissatisfaction with this claim, prompting Raman to request additional time to amend the government’s legal strategy.
Senior Counsel Vikram Choudhry, representing TASMAC, criticized the transparency of the ED’s raids, labeling them as invasive and a violation of privacy rights. He highlighted that the raids included unwarranted searches and the seizure of digital devices, and pointed out that during the operations, employees, including women, were not allowed to leave the premises, resulting in lengthy detentions.
Referring to the Prevention of Money Laundering Act (PMLA), Choudhry argued that searches and seizures should only occur when there is a written reason to believe that a money laundering offense has been committed, and such reasons must be communicated to the relevant officers.
Additional Solicitor General A R L Sunderesan, representing the ED, countered these claims by asserting that the searches were justified based on evidence of a money laundering offense linked to TASMAC. He denied the allegations of improper conduct during the raids.
