The Madras High Court on Wednesday rejected petitions filed by the Tamil Nadu State Marketing Corporation (TASMAC) and the state government challenging Enforcement Directorate (ED) raids conducted in March on the state-run liquor agency.
A division bench of Justices S M Subramaniam and K Rajasekar dismissed two writ petitions by TASMAC and one by the state government, allowing the ED to proceed with its probe under the Prevention of Money Laundering Act (PMLA).
ED Alleges Large-Scale Financial Fraud
The ED had launched raids on TASMAC premises over suspected financial irregularities involving distilleries and bottling units. According to the agency, its investigation uncovered serious instances of unaccounted cash flow and illicit payments.
TASMAC’s Grounds Rejected
TASMAC had argued that the ED’s actions amounted to harassment of its employees under the pretext of investigation. It also claimed the agency’s operations violated the principles of federalism by allegedly overstepping its jurisdiction within state territory.
The court, however, found no merit in the arguments and ruled that the ED is well within its legal authority to investigate suspected offences under PMLA, regardless of state boundaries.
With the dismissal of the petitions, the ED is now free to continue its investigation into the alleged money laundering and financial misconduct involving the state’s liquor distribution network. The ruling marks a significant legal setback for the Tamil Nadu government, which had attempted to push back against the central probe.
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