On April 23, 2025, the Madras High Court dismissed petitions filed by the Tamil Nadu government and the Tamil Nadu State Marketing Corporation (TASMAC) challenging the Enforcement Directorate’s (ED) searches conducted at TASMAC’s headquarters between March 6 and 8. The court upheld the legality of the ED’s actions, allowing the agency to continue its investigation under the Prevention of Money Laundering Act (PMLA).

Key Points from the Verdict:

• Court’s Stance on Political Allegations: The division bench, comprising Justices S.M. Subramaniam and K. Rajasekar, rejected claims that the ED’s actions were politically motivated due to upcoming elections. The court emphasized that such political considerations are not within its purview and should be addressed in the public domain.
• ED’s Allegations: The ED alleged that TASMAC officials were involved in financial irregularities, including overpricing liquor bottles, leading to unaccounted cash transactions amounting to approximately ₹1,000 crore.
• TASMAC’s Defense: TASMAC contended that the ED’s searches were arbitrary, lacked proper jurisdiction, and amounted to harassment of its employees. They argued that the ED initiated the investigation without a confirmed predicate offence, relying instead on FIRs against lower-level staff unrelated to the headquarters.
• Supreme Court Proceedings: Prior to this verdict, TASMAC and the state government had approached the Supreme Court seeking to transfer the case out of the Madras High Court. However, the Supreme Court declined to entertain the plea, leading to its withdrawal.

This ruling enables the ED to proceed with its investigation into the alleged financial misconduct within TASMAC.

Sources